Space-based data have provided important advances in understanding climate systems and processes in arid and semi-arid regions, which are hot-spot regions in terms of climate change and variability. This study assessed the performance of land surface temperatures (LSTs), retrieved from the Moderate-Resolution Imaging Spectroradiometer (MODIS) Aqua platform, over Egypt. Eight-day composites of daytime and nighttime LST data were aggregated and validated against near-surface seasonal and annual observational maximum and minimum air temperatures using data from 34 meteorological stations spanning the period from July 2002 to June 2015. A variety of accuracy metrics were employed to evaluate the performance of LST, including the bias, normalized root-mean-square error (nRMSE), Yule–Kendall (YK) skewness measure, and Spearman’s rho coefficient. The ability of LST to reproduce the seasonal cycle, anomalies, temporal variability, and the distribution of warm and cold tails of observational temperatures was also evaluated. Overall, the results indicate better performance of the nighttime LSTs compared to the daytime LSTs. Specifically, while nighttime LST tended to underestimate the minimum air temperature during winter, spring, and autumn on the order of −1.3, −1.2, and −1.4 °C, respectively, daytime LST markedly overestimated the maximum air temperature in all seasons, with values mostly above 5 °C. Importantly, the results indicate that the performance of LST over Egypt varies considerably as a function of season, lithology, and land use. LST performs better during transitional seasons (i.e., spring and autumn) compared to solstices (i.e., winter and summer). The varying interactions and feedbacks between the land surface and the atmosphere, especially the differences between sensible and latent heat fluxes, contribute largely to these seasonal variations. Spatially, LST performs better in areas with sandstone formations and quaternary sediments and, conversely, shows lower accuracy in regions with limestone, igneous, and metamorphic rocks. This behavior can be expected in hybrid arid and semi-arid regions like Egypt, where bare rocks contribute to the majority of the Egyptian territory, with a lack of vegetation cover. The low surface albedo of igneous and limestone rocks may explain the remarkable overestimation of daytime temperature in these regions, compared to the bright formations of higher surface albedo (i.e., sandy deserts and quaternary rocks). Overall, recalling the limited coverage of meteorological stations in Egypt, this study demonstrates that LST obtained from the MODIS product can be trustworthily employed as a surrogate for or a supplementary source to near-surface measurements, particularly for minimum air temperature. On the other hand, some bias correction techniques should be applied to daytime LSTs. In general, the fine space-based climatic information provided by MODIS LST can be used for a detailed spatial assessment of climate variability in Egypt, with important applications in several disciplines such as water resource management, hydrological modeling, agricultural management and planning, urban climate, biodiversity, and energy consumption, amongst others. Also, this study can contribute to a better understanding of the applications of remote sensing technology in assessing climatic feedbacks and interactions in arid and semi-arid regions, opening new avenues for developing innovative algorithms and applications specifically addressing issues related to these regions.